Media releases

DRDGOLD and TCTA agree terms on acid mine drainage

Details

Published: Friday, 07 December 2012 02:00

DRDGOLD announced today that three of its subsidiary companies – collectively the Ergo Group – have entered into heads of agreement with Trans-Caledon Tunnel Authority (TCTA), aimed at laying a foundation for a self-sustainable solution to acid mine drainage (AMD) in the Central Witwatersrand Basin

Johannesburg, South Africa. 7 December 2012. DRDGOLD Limited (DRDGOLD; JSE, NYSE: DRD) announced today that three of its subsidiary companies – collectively the Ergo Group – have entered into heads of agreement with Trans-Caledon Tunnel Authority (TCTA), aimed at laying a foundation for a self-sustainable solution to acid mine drainage (AMD) in the Central Witwatersrand Basin.

TCTA, acting through directives issued by the Minister of Water and Environmental Affairs and the Department of Water Affairs, is to construct pumping and treatment facilities to intercept rising AMD, and to prevent it from reaching the so-called ‘environmental critical level’.

In terms of the heads of agreement, the Ergo Group grants TCTA:

• access to land for the construction of a water treatment plant;
• access to the South West Vertical Shaft of East Rand Proprietary Mines Limited (ERPM) to construct and operate a pump station to pump AMD to surface;
• the right to construct a sludge pipeline, using servitudes owned by Ergo Group members;
• shared use of an Ergo Group residue pipeline; and
• partial use of the Ergo tailings dams for the deposition of up to 4 167m³ of sludge per day, emanating from the water treatment plant.

Also, in terms of the heads of agreement, Ergo Mining Operations (Pty) Limited (EMO), a member of the Ergo Group, has an option, at its election, to acquire from TCTA, for its operations, up to 30 mega litres of untreated or partially treated AMD per day.

DRDGOLD CEO Niël Pretorius said: “While these heads of agreement should not be seen as an unqualified endorsement of the State’s AMD solution, and do not affect our right to either challenge future directives or to implement our own initiatives should it become necessary, they are an encouraging development. In particular if the spirit of cooperation that led to its conclusion is taken into the implementation and management of the project, this initiative has every chance of success”.

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Disclaimer

Many factors could cause the actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forwardlooking statements, including, among others, adverse changes or uncertainties in general economic conditions in the markets we serve, a drop in the gold price, a sustained strengthening of the Rand against the Dollar, regulatory developments adverse to DRDGOLD or difficulties in maintaining necessary licenses or other governmental approvals, changes in DRDGOLD's competitive position, changes in business strategy, any major disruption in production at key facilities or adverse changes in foreign exchange rates and various other factors. These risks include, without limitation, those described in the section entitled "Risk Factors" included in our annual report for the fiscal year ended 30 June 2011, which we filed with the United States Securities and Exchange Commission on 28 October 2011 on Form 20F. You should not place undue reliance on these forwardlooking statements, which speak only as of the date thereof. We do not undertake any obligation to publicly update or revise these forwardlooking statements to reflect events or circumstances after the date of this report or to the occurrence of unanticipated events. Any forwardlooking statement included in this report have not been reviewed and reported on by DRDGOLD's auditors.